I have 98SE, I've not upgraded because I'm happy with it. I do have people telling me though that ME is better and more stable, but if there was no major problems last time running 98SE stick to what you know works.

XP is a lot stabler, but sometimes it's best to stick with what the hadware was designed for. A while ago everything was for 98, now it's all for XP, and putting 98 on a new PC can cause problems.